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Evergreen Resources purchases 48,000 acres at Pioneer
Company has more than a quarter million acres in its core coalbed methane development in the Raton Basin in Colorado Kristen Nelson PNA Editor-in-Chief
The Pioneer coalbed methane prospect in the Matanuska-Susitna Borough has been purchased by Evergreen Resources Inc., of Denver, Colo., operator of a 500-well coalbed methane operation in the Raton Basin in Colorado.
Evergreen said May 9 that it had signed two coalbed methane property transactions, one in Colorado and one in Alaska, for a combination of more than 75,000 acres.
The Pioneer prospect some 30 miles northwest of Anchorage was purchased from Ocean Energy Resources Inc. and Union Oil Company of California. Evergreen said it acquired a 100 percent working interest in about 48,000 acres of prospective coalbed methane properties for approximately $960,000 in cash.
Evergreen said it believes the Pioneer unit’s coal seams may contain potential unrisked recoverable reserves of up to 500 billion cubic feet of gas; the acreage also contains deeper pay potential in traditional natural gas reservoirs.
Evergreen said it also signed a joint venture agreement for Colorado properties, a work commitment with J.M. Huber Corp. covering 29,000 acres of coalbed methane properties in Huerfano County in the northern end of the Raton Basin. Evergreen will spend a minimum of $2 million through March 31, 2002, to earn a 50 percent working interest in the properties, which currently contain 15 shut-in wells. The properties are approximately 20 miles north of Evergreen’s existing 258,000 acres of coalbed methane properties in Las Animas County, Colo. Evergreen’s planned expenditures will be primarily for drilling, completions, workovers, equipment and fracture stimulations. The agreement was effective April 1, 2001.
Beyond Raton Evergreen President and CEO Mark S. Sexton said, “While our current development focus continues to be the Raton Basin, we have expanded our portfolio of unconventional natural gas projects in North America.”
Evergreen is one of the leading developers of coalbed methane reserves in the United States, with operations primarily focused on the company’s Raton Basin development in southern Colorado, where it has drilled or acquired more than 500 wells and has plans to drill 1,000 more.
The company has also initiated a coalbed methane project in the United Kingdom and owns additional interests in other domestic and international areas. What’s at Pioneer Evergreen began acreage acquisition in Alaska when it applied for shallow gas leases in the Matanuska-Susitna area when the non-competitive shallow gas leasing program was initiated in early 2000.
The Pioneer prospect acreage Evergreen has just acquired was assembled by Unocal, who brought in Ocean Energy as operator at the unit. Drilling began in 1999, and in 2000, Ocean Energy reported to the state that it had completed work at four wells in the unit: a water disposal well, two shallow gas development wells and a reentry of the ARCO Big Lake BLT 01, a conventional vertical exploration well drilled by ARCO Alaska Inc. in 1992. ARCO was reported to be looking for oil; it plugged and abandoned the 6,200 foot well south of Houston off the Big Lake Road.
At a recent coalbed methane conference Charlie Barker of the U.S. Geological Service said information provided by Ocean Energy and Unocal indicated coals at Pioneer appear to be gas saturated. Dan Seamount, formerly with Unocal and now a commissioner at the Alaska Oil and Gas Conservation Commission, said Unocal and Marathon Oil Co. looked at the possibility of a regional coalbed play in the Cook Inlet area in the early 1990s, and assembled a state and Native fee acreage position of some 50,000 acres.
Citing information provided by Unocal and Ocean Energy, Seamount said the disposal wells encountered 26 coal seams greater than four feet. The coal cores looked good, and he said that they did find a lot of gas in the coal seams.
Results of the wells are confidential.
Seamount said several steps are needed: the wells have not been fracture stimulated; new wells are needed on the axis of the Pittman Anticline; a non-damaging drilling medium is needed; and regulations probably need to be tailored for coalbed methane.
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